Euro Technical Outlook: EUR/USD Short-term Trade Levels
- EUR/USD ripped higher following the Federal Reserve decision, extending more than 1.2% off the weekly low
- The immediate focus is now on uptrend resistance, where the Euro may face a near-term inflection; a daily close above this threshold would be needed to fuel the next leg of the advance.
- Resistance 1.1731/47, 1.1794-1.1813 (key), 1.1866- Support 1.1679, 1.1634/41 (key), 1.1590-1.16
Euro is on pace to mark a third-consecutive weekly advance with EUR/USD surging on the heels of the Fed rate decision yesterday. The rally is testing uptrend resistance today and a close above this threshold could unleash another bout of accelerated advances for the bulls. While the broader structure remains constructive, the near-term outlook hinges on the reaction at this threshold into the weekly close. Battle lines are drawn on the Euro short-term technical charts.
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Euro Price Chart – EUR/USD Daily
Chart Prepared by Michael Boutros, Sr. Technical Strategist; EUR/USD on TradingView
Technical Outlook: In my last Euro Short-term Technical Outlook we noted that the EUR/USD, “breakout has extended into near-term uptrend resistance and may be vulnerable to a pullback within the multi-week uptrend. From a trading standpoint, losses should be limited to channel support IF price is heading higher on this stretch with a close above 1.1679 needed to fuel the next leg of the advance.” A four-day decline off those highs extended nearly 0.6% off the monthly high before rebounding yesterday with the post-Fed rally now extending nearly 1.5% off the December low. The advance is now testing confluent resistance, and the focus is on today’s close with respect to the upper bounds of the late-November channel.
Euro Price Chart – EUR/USD 240min
Chart Prepared by Michael Boutros, Sr. Technical Strategist; EUR/USD on TradingView
Notes: A closer look at Euro price action shows EUR/USD approaching confluent resistance at the October high-day close and the 61.8% retracement of the decline off the yearly high at 1.1731/47. A daily close above this threshold is needed to keep the bulls in control with subsequent resistance objectives eyed at 1.618% extension of the late-November rally and the 2025 high-day close (HDC) at 1.1794-1.1813 and the yearly high-close at 1.1866. Both represents regions of interest for possible top-side exhaustion / price inflection IF reached.
Initial support now rests with the 100% extension at 1.1679 with near-term bullish invalidation now raised to the November HDC and the weekly open at 1.1634/41. A daily close below this threshold would be needed to suggest a more significant high is in place and that a larger trend reversal is underway toward the December low / open at 1.1590-1.16 and the October swing low at 1.1542.
Bottom line: The outlook for the EUR/USD remains constructive with the immediate focus on a reaction into near-term uptrend resistance. From a trading standpoint, losses should be limited to 1.1679 IF price is heading higher on this stretch with a close above 1.1747 needed to fuel the next leg of the advance.
Keep in mind we get another bout of event risk next week with the November Non-Farm Payrolls report, CPI on the European Central Bank rate decision on tap. Stay nimble into the releases and watch the weekly closes here for guidance. Review my latest Euro Weekly Technical Forecast for a closer look at the longer-term EUR/USD trade levels.
Key EUR/USD Economic Data Releases
Economic Calendar - latest economic developments and upcoming event risk.
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--- Written by Michael Boutros, Senior Technical Strategist
Follow Michael on Twitter @MBForex
